Portugal: A Foreign Company & Taxes

In this episode, Tytle’s tax expert explores the taxation of foreign company income for individuals living in Portugal. The discussion begins with an explanation of when Portugal taxes a foreign company’s income, highlighting that while Portugal generally doesn’t tax the company directly, any personal income you receive, such as salaries or dividends, will be subject to Portuguese tax rules.

Key topics include how to avoid having your foreign company classified as a Portuguese tax resident by ensuring key management and decision-making remain outside Portugal. The episode also examines how Portugal’s Non-Habitual Resident (NHR) regime may provide tax benefits for income like dividends or salaries, provided specific conditions are met.

Additionally, the implications of receiving dividends from a foreign company are discussed, as well as the potential benefits of relocating your business to Portugal under its favorable tax regimes for small businesses.

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